Eligible
7(a) loan proceeds may be used to establish a new business or to assist in the operation, acquisition or expansion of an existing business. Eligible use of proceeds include (non-exclusive):

• To purchase land or buildings, to cover new construction as well as expansion or conversion of existing facilities;
  
• To acquire equipment, machinery, furniture, fixtures, supplies, or materials;
  
• For long-term working capital, including the payment of accounts payable and/or for the purchase of inventory;
  
• To refinance existing business indebtedness that is not already structured with reasonable terms and conditions;
  
• For short-term working capital needs, including seasonal financing, contract performance, construction financing, export production, and for financing against existing inventory and receivable under special conditions;
  
• To purchase an existing business.

Ineligible
There are certain restrictions on SBA loans, which cannot be used for these purposes:

• To refinance existing debt where the lender is in a position to sustain a loss and SBA would take over that loss through refinancing;
  
• To effect a partial change of business ownership or a change that will not benefit the business;
  
• To permit the reimbursement of funds owed to any owner, including any equity injection or injection of capital for the business’s continuance until the loan supported by SBA is disbursed;
  
• To repay delinquent state or federal withholding taxes or other funds that should be held in trust or escrow;
  
• For a non-sound business purpose.